Question

3. Over the project life cycle there is a tendency for the "Potential to add value" (level of influence) and "Cost of change" to change and differ (a) Present and justify the graph "Potential to add value" (level of influence) and "Cost of change" [15 marks] (b) Provide an example to explain the application [8 marks] (c) Explain how it is possible to increase the value and reduce the cost of change [10 marks] Page 2 of 3 TURN OVER

Answer 1

(a) Potential for adding value to type products of a project are obviously highest during the conceptual phase of the project and lowest during the finishing phase.Between these two extremes,the curve tends to follow a reverse "S" curve as shown in the attached image.Conversely,the cost of making changes is lowest in the planning phases,but rises more and more steeply as the project progresses through through the two production phases.In construction,for example,it has been suggested that the cost to make a change,or fix a non-conformance,increases by ten times through each suceeding major phase.If the cost-to-change curve is considered in conjunction with that of adding value,the implications to management decision making become readily apparent.The intersection of the two curves probably represent the point at which a change in scope changes from a constructive opportunity into a destructive intervention.

B) A US construction company won a contract to design and build the first copper mine in northern argument.During the initiation phase of the project,the project manager focused on defining and finding a project leadership team with the knowledge,skills,and experience to manage a large complex project in a remote area of the globe.During the planning phase,the project team developed an integrated project schedule that coordinated the activities of the design,procurement and construction teams.During the implementation phase,the project team accomplished the work defined in the plan and made adjustment when the project factors changed.The closeout phase included turning over the newly constructed plant to the operations team of the client.Estimated cost may change during the execution of the project which would affect the value derived from the project.The change may be unexpected and if the team failed to manage it effectively it may badly affect the outcome of the project.

C)Project cost can be decreased by paying alot of attention to initial planning.This is something quite challenging as it would require the manager to think about all of the scenario that could take place in advance.Use of high end and comprehensive tools helps in successful project management.At the same time, it enable quick collaboration and inter team transparency, guaranteeing that everything is handled as per the highest standards.Vendors plays an important role in increasing the value of project.Check how good vendor is when it comes to maintaining deadlines.Take a look at vendors overall capabilities.This is something absolutely critical as if you fail to do this on time, it could potentially derail the project and cause you to look for different vendors half way through.Make an effort to stay within the budget.

Your project should always be looked after.You cant improve anything that you are not currently measuring.With this said, a project manager needs to track the progress on each tasks constantly in order to make sure that everything is handled as per the highest standards.This would potentially enable him to stay on top and to make sure that the project is being handled properly.